Compo plan proposed for insurers, banks
The Australian Prudential Regulation Authority wants the Federal Government to establish a formal compensation scheme so that victims of institutional collapses are partly bailed out.
The scheme would cover banks and other deposit-taking institutions, general and life insurance companies, and superannuation funds. APRA's preferred model is one in which moneys for a bailout are collected after a collapse, the model which has been used recently in the cases of two small super funds and Ansett.
APRA said that Australia is one of the few OECD countries without such a bailout plan.